At the national level, Hong Kong has by far the most unaffordable housing, with a median multiple of 14.9. Australia and New Zealand are tied for second most unaffordable market out of the nations surveyed (both 5.5), followed by Singapore (5.1), United Kingdom (4.9), Japan (4.0), Canada (3.9), United States (3.4), and Ireland (2.8).

All of Australia's 39 markets captured in the survey are ranked as either "Seriously Unaffordable" (14) or "Severely Unaffordable" (25). Australia currently has no housing markets ranked as "Affordable" or "Moderately Unaffordable". The result represents a slight improvement on last year's survey, where 30 markets were ranked as "Severely Unaffordable".

Looking at the major metropolitan areas only - i.e., those with more than 1 million inhabitants - Australia ranks as third most expensive after Hong Kong and New Zealand (Auckland).

Overall, Australia has moved down the league tables, registering 5 out of the 20 most expensive housing markets identified in the Survey, versus eight in last year's survey.

So why are Australian house prices so expensive. The report puts it down to high land prices, which in turn is due to Australia's restrictive land use policies. It's no surprise that locations with more liberal land use regimes have lower prices:

By contrast, affordable housing markets, like Texas and Georgia in the United States, utilise open market-based land use structures whereby plentiful new housing supply is able to be built quickly and cheaply on the urban fringe, thereby preventing rapid house price escalation.

The report claims that less restrictive land use policies also have other benefits:

So under an open market-based model (provided there are not also substantial physical barriers to housing supply), increased demand, such as from reduced lending standards and easier availability of credit, quickly leads to the building of additional low priced housing on the urban fringe, which helps keep house prices in check and reduces the likelihood of speculative housing bubbles developing. Further, highly leveraged speculators are less likely to be encouraged into open land markets, since there is little prospect of achieving strong capital gains. Investing in open land markets is, instead, more about rental yield.

I will add that restrictive urban planning structures should not be viewed as a one-way bet for house prices, with unresponsive land supply also more likely to result in higher levels of house price volatility and boom/bust price cycles - a fact also acknowledged by Demographia. Why? Because strict land-use policies (planning) steepens the supply curve, which makes house prices more sensitive to changes in demand, increasing the likelihood of the housing market experiencing boom/bust price cycles as demand rises/falls.

Friday, 17 January 2014

In Why the Arctic Is Drunk Right Now Chris Mooney explains how the warming of the Arctic is impacting on the jet stream. This in turn is bringing spells of extreme hot and cold weather to parts of the northern hemisphere.

In other words, we're experiencing record-breaking cold temperatures because a wavy and elongated jet stream has allowed frigid Arctic air to travel much farther south than usual.

Sunday, 5 January 2014

The health care system in the US has all the hallmarks of an inefficient market.

It's the most expensive in the developed world.

Medicare, the US Government run single payer system for the elderly is much cheaper and more efficient than the system for those under 65. To quote the article: "If everyone in the U.S. was on Medicare, the savings would move the federal budget from deficit to surplus."

The US spends 17.6% of its economy on health care compared to 11.5% in Canada, France and Germany.

48 million Americans had no health insurance in 2012. Another 30 million were only covered for part of the year.

Amy Parker in Growing Up Unvaccinated discusses all the childhood illnesses she suffered through because she was not vaccinated by her parents. She makes some great points:

Anecdotal evidence is nothing to base decisions on. But when facts and evidence-based science aren’t good enough to sway someone’s opinion, then this is where I come from. After all, anecdotes are the anti-vaccine supporter’s way. Well, this is my personal experience. And my personal experience prompts me to vaccinate my children and myself. I got the flu vaccine recently, and I am getting the whooping cough booster to protect my unborn baby. My natural immunity from having whooping cough at age 5 will not protect him once he’s born.

I understand, to a point, where the anti-vaccine parents are coming from. Back in the 90s when I was a concerned, 19-year-old mother, frightened by the world I was bringing my child into, I was studying homeopathy, herbalism and aromatherapy; I believed in angels, witchcraft, clairvoyants, crop circles, aliens at Nazca, giant ginger mariners spreading their knowledge to the Aztecs, the Incas and the Egyptians and that I was somehow personally blessed by the Holy Spirit with healing abilities. I was having my aura read at a hefty price and filtering the fluoride out of my water. I was choosing to have past life regressions instead of taking anti-depressants. I was taking my daily advice from tarot cards. I grew all my own veg and made my own herbal remedies. I was so freaking crunchy that I literally crumbled. It was only when I took control of those paranoid thoughts and fears about the world around me and became an objective critical thinker that I got well. It was when I stopped taking sugar pills for everything and started seeing medical professionals that I began to thrive physically and mentally.

If you think your child’s immune system is strong enough to fight off vaccine-preventable diseases, then it’s strong enough to fight off the tiny amounts of dead or weakened pathogens present in any of the vaccines.